We’re excited to share that E3 has been selected to continue supporting the California Public Utilities Commission (CPUC) Integrated Resource Planning (IRP) process for the next 4–6 years.
The CPUC established the IRP process in response to a major shift in California’s planning landscape. The prior Long-Term Procurement Planning (LTPP) process had been developed in the aftermath of the 2000-2001 energy crisis to identify investments needed for reliability. With increasingly high clean energy goals, a wider focus was needed and the California legislature passed SB 350 in 2015 directing the Commission to establish an IRP process. The CPUC engaged E3 in 2016 to help design the IRP process that is still in use today.
This process involves a “top-down” planning effort using E3’s best-in-class long-term capacity expansion model, RESOLVE, developed in coordination with “bottom-up” individual IRPs prepared by more than 45 load serving entities. The resulting Preferred System Plan informs policy, procurement and CAISO’s Transmission Planning Process.
This new IRP contract builds on a lengthy track record of strong E3 support for the CPUC’s clean energy planning efforts. Our cooperation dates back to 2003, when E3 developed the first version of the Avoided Cost Calculator (ACC), and it has included annual updates of the ACC, subsequent support for evaluating the feasibility of higher renewables goals, evaluation of the cost-effectiveness of investments made under the Self-Generation Incentive Program, and providing technical evaluation of alternative rate designs and Net Energy Metering compensation mechanisms, in addition to our current support for the IRP proceeding.
As a global leader in the energy transition, California continues to tackle some of the most challenging questions facing the industry and the IRP proceeding has been a central venue to address those challenges. E3 modeling back in 2019 began to identify a looming resource adequacy shortfall, and E3’s analysis has since supported three major reliability procurement orders totaling nearly 19,000 MW of effective capacity and leading to one of the fastest buildouts of grid scale battery storage resources in the world. Recent system plan modeling conducted by E3 showed that nearly 100 GW of new solar, wind, geothermal, and energy storage resources would be needed by 2040 to meet the state’s clean energy goals.
Additional challenges the state is facing include managing accelerating load growth, meeting long-term resource adequacy needs, and investing in new technologies such as advanced geothermal and offshore wind, all while maintaining affordability for California ratepayers. To address these, E3 has supported the CPUC’s development of a new programmatic procurement framework for clean energy and reliability needs, the evolution of resource adequacy planning practices amidst changing system dynamics, aligning cost-effectiveness evaluation of supply side and DER resources, and consideration of societal costs in DER cost-effectiveness methodologies.
We’re honored to continue this work to help California plan for a reliable, affordable, and equitable clean energy transition. E3 has also supported IRPs for entities across North America, including Hawaiian Electric, Sacramento Municipal Utilities Board, Pasadena Water & Power, Salt River Project, Arizona Public Service, NV Energy, Black Hills Energy, Xcel Energy, Public Service Company of New Mexico, El Paso Electric, Omaha Public Power District, Dairyland Power Cooperative, Illinois Power Authority, NYSERDA, FPL, Manitoba Hydro, Nova Scotia Power, and many others, bringing our unique planning insights to a diverse range of systems, each with their own regulatory, reliability, and customer needs.
